Clint Ballinger

Soooo uhhh… hey guys. I have a weird (100% real) story I wanna tell everyone. So this Saturday, my girlfriend (6’2, Caucasian, tall and well-built) and I were having passionate sex. Both of us were really enjoying it and everything was going great. Who could’ve predicted what happened next? She asked me a straightforward question: ‘Why does it feel so good’? And I wanted to be nerdy, so I answered: ‘Think of it this way; there’s an equation where MV=PT. This was Mr. Fisher’s quantity theory. Assuming V (velocity of circulation) and T (real output) constant, when P (price level) increases M increases t-‘ But right when I was about to finish, I heard a loud bang. To my horror, the L.S.E. Economists (including Hayek) and the Chicago economists (including Bob Lucas Jr.) burst in, grabbed me by the hair, and started to beat me relentlessly. ‘Ow! What’s wrong with you l-‘ I cried, but could not finish, for my jaw was nearly struck in half by a near-arthritic fist. ‘You tried to reason from an identity.’ A young Ronald Coase (or was it Hayek?) growled. ‘You should know better. In the real world, factors like ‘V’ and ‘T’ cannot simply be assumed to be held constant, because aggregates don’t interact with aggregates, individuals interact with individuals. And a different cause of a variable change; e.g. a rise in the price-level; can lead to profoundly differing effects in the overall effects. This is because, again, changes in these variables are due to individual decisions.’ ‘U-Uhh… O-‘ I stammered, before another fist found my jaw. It was Bob Lucas’s. ‘This is merely another sin in your laundry list of fallacious reasoning. What makes you keep trying to establish macrofoundational theory without first establishing adequate microfoundations?.’ He jeered, shaking an accusing finger in the process. ‘Have you not read “Expectations and the Neutrality of Money” yet?’ ‘Or “Econometric Policy Evaluation; a Critique”’? ‘Under rational expectations’, he tried to explain whilst near-catatonic, ‘attempting to create macroeconomic predictions based off historical data is useless because individuals are forward-looking, and adjust their choice set and preferences according to prior policy. You. need. adequate. microfoundations. Understood?’ I thought of protesting, but I didn’t want them to catch further fallacies in my reasoning. Perhaps if I did, Chicago would deny me tenure in the distant future. So, instead, I whispered a simple ‘I understand’. The economists seemed to have accepted my apology and left, but I knew one thing was clear. I would never reason from an identity again, whether it was Y=C+G+I+NX, or S=I, or even MV=PQ.

I was in the Northernlion Discord Server™️ talking about economics in broad strokes one time and I had to break it to a guy that MMT was considered crank nonsense by academic economists at large. Especially sad since he brought it up in the context of Economics actually having a pretty sound empirical basis.

It’s not about quantity, it’s about quality

We humans are going to have to decide whether jobs exist simply to accomplish tasks or if employment as a social technology is worth preserving to maintain social order. Because companies are making decisions with heavy social consequences based on their own economic incentives.

MMT tells you a monetarily sovereign nation can issue all the currency/debt it wants and nothing will happen, claiming that currency and market volatility can easily be eliminated by cancelling the capital account. This nonsense can only be promoted by someone that does not understand that the currency collapse and creditworthiness slump are driven by domestic citizens and savers rejecting the local currency; it is not an evil conspiracy of foreign investors. Furthermore, no nation is monetarily sovereign. It always depends on demand. Try to force use or restrict flow, and the currency is worth nothing. And local citizens are the first to reject an increasingly worthless currency issued by an irresponsible government. You are welcome